The average demand for flu vaccines in the US for next season is 80 million with a standard deviation of 8 million, assuming a normal distribution. Each flu vaccine costs approximately $35 to produce and ship to all the states. If a person wants a vaccine and can not get it the estimated cost to society is $500 (this is the weighted average cost - some people may still be perfectly healthy while others may require hospitalization while a few may die).

Match the correct numbers with the parameters.

Keep in mind that when the flu season hits, it is too late to produce any additional vaccines, and that left-over vaccines are worthless since the flu next year will be different. Hint: Treat this just like you would if were "selling" the vaccine (for $500), with it having cost you $35. The only difference is that rather than receiving cash of $500 upon vaccinating someone, you are avoiding a $500 payout (but you had to spend the $35 to save the $500 so the net gain, i.e., the cost of underage, is $465).

mu (average demand)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

sigma (std dev of demand)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

p (price)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

c (cost)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

s (salvage value)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

cu (cost of underage)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

co (cost of overage)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

Pc (critical ratio)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

z-value (from the normal distribution)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million

Q (optimal quantity to produce)

[ Choose ] 500, 0.93, 8 million, 80 million, 1.476, 35, 465, 0, 91.8 million